Owns rental,

My question is: Canadian-specific
QUESTION: I brought an investment property 6 years ago and made several lump
sum payments over the years.  The house is currently worth about $800,000
and the mortgage is less that $100,000.  I am wondering how I can get some
cash out of the property and still be able to write off the interest against
the rental income.  I want to keep the rental property but also buy another
house to live in.  Can I get a re-finance the mortgage on the rental
property and buy a REIT then after 6 months sell the REIT and purchase a
home as a personal residence?  Thereby having a really some mortgage on my
new house and a large mortgage on the rental property.
Thanks
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david ingram replies:
NO Bulletin IT-535 makes it really clear that when you sell the investment
vehicle that you borrowed the money for (the REIT) the interest is no longer
deductible unless you use the money for another investment.
The November 2001 newsletter in the top left hand box at www.centa.com will
give you some ideas about how to make the personal residence deductible but
your suggested method will NOT work.
This is a good question for tomorrow's radio program
at:
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